There is no win-win situation in a fragmented world

Singapore’s education minister, Chan Chun Sing, said in his keynote address at the Morgan Stanley Asia-Pacific Summit in Singapore on Wednesday that Singapore will not take sides in geopolitical disputes and will instead take positions in support of the rule of law.

He said the world must remain interconnected despite the pressures of disintegration, because any kind of rift would make individual nations “suboptimal” and suffer economically.

“With interdependence comes danger,” Chan said, “but a fragmented world with less interdependence, where people and major countries think they can enhance their own security, and indirectly exacerbate the insecurity of another country, this cannot be a win-win situation.” For everyone”.

“It is important to remember that a more interconnected world is a safer world. But today, because of pressures, both local and global, there is a temptation to think that if the world were divided, then two different blocks, each of the different blocks would be safer.”

If fragmentation persists, Chan said, countries and companies will perform less than optimally, “instead of … enjoying the past 50 years of rapid growth based on a globally integrated system.”

He added, citing the example of the Cold War.

He cited the Russian war in Ukraine and Dispute settlement crisis in the World Trade Organization Like some cracks in the system.

Chan spoke directly to business leaders and investors at the investment conference, calling for global integration.

“Global companies have a voice and need to be heard, and you would prefer an integrated world, not a fragmented one,” Chan said.

He said Singapore would play its part by building bridges and “working together” across the fractious blocs.

“We believe there will be a premium on connectivity, stability, progress, cohesion and trust,” Chan added.

Morgan Stanley Investment Management said in a separate note on Wednesday that fragmentation is beginning to disrupt the stability of the global economy.

Deglobalization and the collapse of supply chains, for example, are fueling inflation, said Andrew Harmston, the company’s senior portfolio manager.

“World trade as a percentage of GDP was in the past rising very quickly, which contributed to the very low rate of inflation. But the trend towards resettlement will tend to reduce trade,” he said.

According to the Heinrich FoundationAlthough terms like “support friends” have been added to the lexicon of US trade policy and those of other countries such as Japan, not much has been revealed about what they mean.

“If governments seek to intervene in the supply chain, they must demonstrate that they monitor risk better than companies do. But it is less clear what friend-to-friend policies will address market failure without further fragmenting the global trading system.” Hallett Harbutt saidAnd the Author of the Heinrich Report.